Colorado AI regulation bill clears legislature
Colorado legislature passed SB 26-189 on May 9, 2026, repealing and narrowing its first-in-the-nation 2024 AI law after two years of negotiations between tech industry and consumer advocates.
Objective Facts
After attempting to amend its first-in-the-nation AI law for two years and three legislative sessions, on May 9, 2026, the Colorado legislature passed SB 26-189. Instead of requiring companies, governments and other groups that create and use artificial intelligence to disclose how their AI systems help make decisions on things like hiring, loans and housing, they would just have to notify consumers when the technology is being used to make such consequential decisions. They would also have to give consumers an opportunity to appeal. Senate Bill 189 passed the House by a 57-6 vote and cleared the Senate 34-1. The measure, which had broad bipartisan support in both chambers, now heads to Gov. Jared Polis to be signed into law. Unlike the original AI Act where rulemaking was permissive, rulemaking under the new bill is mandatory. Further, rulemaking must be completed by January 1, 2027.
Left-Leaning Perspective
Anya Robinson with the Colorado ACLU testified in support, emphasizing that "Access to clear, timely and actionable information is what allows individuals to exercise their rights, contest errors and make informed choices." The People's Alliance for Responsible Technology (PART), a consortium of labor and consumer protection groups, said the bill is "a good first step" but acknowledged "there's still work to be done to ensure Big Tech companies are transparent and accountable." Robert Lindgren with the Colorado AFL-CIO argued that the bill removes needed protections, saying "Gone are the risk management requirements, impact assessments, annual reviews and discrimination reporting" and "It introduces a cure period that lets developers delay accountability and allows discriminatory practices to continue under current law." The Colorado AFL-CIO believes that the lack of discriminatory analyses and comprehensive program explanations in the new bill rolls back needed protections for consumers and workers, and asked sponsors to remove the right to cure that lasts until 2030. State Rep. Javier Mabrey, a Denver Democrat who voted for the bill, said "These black boxes are deciding who gets hired, who gets housing, who gets to go to their dream school" and urged lawmakers to keep evaluating what kinds of regulations should be imposed on AI, voicing support for letting consumers file lawsuits when they've been wronged, vowing to force the legislature to debate changes to the law in the future.
Right-Leaning Perspective
Brittany Morris Saunders, president and CEO of the Colorado Technology Association, said the bill "represents meaningful progress for Colorado and a more balanced path forward" that has "worked with policymakers, member companies, and partners across the business and technology communities to advance a framework that protects consumers while allowing Colorado companies to innovate, hire and grow." Bryan Leach, CEO of Ibotta, said Senate Bill 189 "is a marked improvement over the original bill that was passed" and "feels it's a much more practical approach." The tech industry had said the original law was "unworkable" and would "stifle innovation," and President Donald Trump threatened to withhold federal funds if Colorado enforced it, calling it "cumbersome" in his executive order to bar states from passing robust AI regulations. Business leaders, stinging from the out-of-state move of software giant Palantir because of the 2024 AI law, said the new bill corrects the biggest existing issues. Supporters ranging from the ACLU of Colorado to the Colorado Chamber of Commerce said the bill hits the sweet spot of holding companies responsible for discriminatory actions without overregulating them so much that the growing AI industry will move to other states with fewer rules.
Deep Dive
Colorado's AI regulation saga began in 2024, when the legislature passed Senate Bill 205, the nation's first comprehensive law governing the technology. Almost immediately after Polis signed it into law, he, Rodriguez and Attorney General Phil Weiser signed a letter vowing to revisit and change the policy, citing concerns from the tech industry. Attempts to reach a deal between businesses and consumer advocates during last year's regular lawmaking term and a special legislative session in August failed. Staring down the fact that Senate Bill 205 was supposed to take effect in February, the legislature punted the start date to June to give the General Assembly more time to iron out a compromise. Polis formed a working group made up of tech, businesses, labor and legal leaders, which came up with a framework that led to Senate Bill 189. The legislation sailed through the Capitol in less than two weeks with few changes and limited resistance. Supporters of the new law describe the bill as a more business-friendly refinement of Colorado's earlier AI framework. Critics, however, have expressed concerns from multiple directions. Some technology advocates argue the rules remain burdensome for AI developers, while some consumer advocates believe the bill weakens protections compared with earlier proposals. This measure is the beginning of the debate over AI rules rather than the end. Several technology and business groups said they'll take their concerns to the rulemaking process that is set to begin soon, and one of the House's leading progressives said he will be back with a bill next year to put stronger consumer protections. Although the bill removes and narrows obligations under the existing law, Colorado still will have the most far-reaching legislatively enacted deployer/private sector AI law of any state. The defining question moving forward is whether disclosure-based transparency can effectively prevent algorithmic discrimination without proactive risk assessment and bias testing, and whether Attorney General enforcement alone provides adequate accountability without private lawsuits.